The International Monetary Fund on Tuesday asserted that there was a synchronized slowdown in the global economy with over 90 percent of the world witnessing sluggish economic growth. IMF Managing Director Kristalina Georgieva said the slowdown was more evident in the fastest-growing economies including India and Brazil.
She said the economic growth across the world is expected to be slow in 90 per cent of the countries. Calling it a consistent slowdown, Georgieva said the economic growth in 2019 will be the lowest since the beginning of the decade.
Attributing the slowdown to uncertainties, Georgieva referred to trade tensions, Brexit and geopolitical tension for a persistent economic slowdown in the economy.
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She said the trade tensions could lead to further weakening of manufacture and investment which would have a cascading effect on services and consumption.
The newly-appointed IMF chief added that everyone loses in a global trade war and its combined effect could result in a loss of $700 billion by 2020 i.e. 0.8 percent of GDP. She also held the US-China trade war responsible for global economic slowdown and compared the present scenario to that of two years ago when 75 percent of the world was witnessing accelerating growth.
To combat the global economic crisis, the IMF chief called for a coordinated response adding that high time that the countries act together to reverse the slow economic growth trend.
She warned that the trade rifts would have a lasting impact which would further cause broken supply chains and trade sectors. Georgieva also threw light on new research by the IMF and World Bank that will be unveiled during the annual meetings next week. The research focuses on US tariffs on Chinese imports.
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